The Internet was supposed to be the great equalizer. Massive amounts of free stock market information would put amateurs on par with investment pros. But online trading's appeal faded as the dot-com bubble burst and the market tanked. At the same time, dozens of investment Web sites have ceased to exist, including fund portal Mutualfunds.com and Investorama.com, which once linked to 16,000 financial sites.
One result: Some of the best online investment information and research tools are no longer free. Sure, you can still go to Yahoo! Finance or Microsoft's Moneycentral for news and commentary, market data, financial calculators, basic research tools, and investor message boards. But if you want to dissect a mutual-fund portfolio, get easy access to the latest corporate securities filings, or delve deeper into the minute-by-minute machinations of the stock market, you'll have to pay.
The question is, what's worth paying for? We reviewed dozens of premium financial sites and came up with seven favorites. The list covers services that would be useful to a broad range of investors.
EdgarOnline.com and 10kwizard.com are terrific for investors who want to carefully research a company's financial health. Both let you see filings corporations have made with the Securities & Exchange Commission. And they offer decided advantages over the SEC's www.sec.gov and FreeEDGAR.com, which also give you access to SEC documents but are free.
For one thing, EdgarOnline and 10kwizard send you e-mail alerts within minutes of when the companies you specify file their reports with the SEC. They provide better search functions, including the ability to scour the entire database when you're looking for hard-to-find data, such as references to individual executives or board members. They also offer more flexible options for printing filings and downloading financial data into spreadsheets. In pricing, 10kwizard has the edge. Its lowest price is $125 a year, vs. $44.85 per quarter for EdgarOnline. In addition, EdgarOnline charges you $2 each for the reports corporate insiders must file when they buy or sell their company's stock. EdgarOnline.com also limits the number of companies on your "watchlist" to 25. There's no such limit at 10kwizard.com
For $25 a month, B4Utrade.com caters to market junkies. Anyone who likes to track trading during the day and stay on top of the latest Wall Street buzz will find it helpful. For example, its portfolio trackers will flash real-time quotes on the stocks you own in green (for gainers) and red (for losers). WebFN, a live streaming-video broadcast of financial news, appears in a corner of your computer screen. The site posts stock recommendations by analysts and professional investors, including stocks mentioned on CNBC. It flags stocks that brokers and professional investors are buying and selling. You can also sign up to receive e-mail alerts if there's breaking news, changes in analyst recommendations, or surges in trading volume in the stocks you watch.
For an additional $10 a month over the basic fee, B4Utrade.com will deliver Nasdaq Level II market-maker activity. This shows all pending bid and ask orders, and helps you figure out whether there's more pressure to buy and sell. B4UTrade.com requires that you have the latest version of whichever Internet browser you use. And if you're still using a dial-up modem, check to see if your connection is fast enough.
Dismalscientist.com takes a more cerebral approach to understanding the U.S. and foreign financial markets as well as broad economic trends. For $16.95 a month, it offers expert commentary on the latest consumer-price-index report or the Federal Reserve's most recent statements on interest rates. The assessments come from economists on the staff of Economy.com, a large economic research firm.
Investors who need help figuring out what they already own can get considerable insight from Morningstar.com. The Chicago company is best known for its star ratings of mutual funds. For $11.95 a month, Morningstar.com also offers a set of premium services that is among the best anywhere when it comes to dissecting a fund portfolio.
Consider the "X-Ray" tool. Enter your mutual-fund holdings, and programs will treat them as one big portfolio. They will then deconstruct the holdings to show you how much you have, say, in aggressive growth stocks or slow-growing companies. You can also run your fund portfolio through the "stock overlap" tool. This analysis will tell you if any of your funds own the same stocks. That's another way to test if you're diversified. If Microsoft is one of the largest holdings in half of your funds, you're probably not well-diversified. The site also provides tools to pick apart stock portfolios, along with research on about 1,000 stocks that is free of the taint of bias that permeates stock-research reports prepared by investment banks.
Active traders may find Gainskeeper.com to be a worthwhile investment. This site does one thing well: It keeps track of capital gains. Through a link to your online brokerage account, it downloads data on individual trades, distributions, and splits for tax purposes. It keeps you current on your capital gains and losses and helps you determine what the tax implications are for a particular trade. At tax time, it prints out a Schedule D form.
Gainskeeper also monitors trades that come under the Internal Revenue Service's wash-sale rule, designed to prevent investors from recognizing artificial losses by selling a stock for a loss and then repurchasing it within a short period of time. The service starts at $19 a year for up to 30 transactions.
If you're assembling a retirement portfolio, Financialengines.com could help. Developed by Nobel prize-winning economist William Sharpe, it recommends specific mutual funds to help you achieve your goals. The site's strength is its ability to estimate the probability that you will have a specified amount of income when you retire, based on your holdings and contribution rate. It works best when your portfolio consists of publicly traded funds and stocks, not proprietary funds found in many 401(k) plans.
Subscribe to Financialengines.com only if your employer doesn't already provide it or a similar service on the corporate 401(k) site. The basic retirement-planning services cost $39 per quarter; $300 a year buys you the complete package, which adds tools for short-term planning, such as saving for college or a new home.
None of these Web sites is a substitute for a financial adviser. And they're probably not worth the money if all you're seeking online is basic investment information. But if you're an investor who's looking for that next level of assistance, you can still get help for less than the cost of hiring a professional.
By Geoffrey Smith